US ECONOMY BEATS EXPECTATIONS (DIA, SPY, SPX, QQQ)

Thursday

According to the BEA's advanced estimate, GDP grew at a 3.5% pace. While this was down from 4.6% in Q2, it was well ahead of the 3.0% expected by economists.

A few surprises included government spending, which jumped by 4.6%. This was responsible for 0.83 percentage points of GDP growth.

"After being such a massive drag on the economy in recent years, the public sector is now a big positive," Capital Economics' Paul Ashworth said.

Despite some slowdown in the housing market, residential investment also had a nice showing.

"The big upside surprise in the data is the residential investment component, where the 1.8% increase is impossible to square with the monthly construction data — we expected a 10% drop — and a downward revision in due course is a decent bet," Pantheon Macroeconomics' Ian Shepherdson noted.